Sprint CEO won't rule out price increase for excessive data use

Computerworld - Sprint Nextel might increase the $10 monthly surplus it charges for 4G smartphones if their average data usage gets too high, CEO Dan Hesse said Wednesday.

Sprint sells the HTC Evo 4G and Samsung Epic 4G smartphones and charges those customers $10 a month more than users of other smartphones, who often pay $60 or more a month. The added cost is because both phones have larger screens and 1 GHz processors, which tend to draw heavy data users, Hesse said at the EmTech@MIT 2010 conference Wednesday.

"We know that users will use a lot more data [on Epic and Evo], so we charge $10 more," Hesse said. "If we have to, if the average usage gets too high, we might have to increase the price," Hesse said during a question-and-answer session after his keynote remarks.

During the keynote, Hesse also held up a Samsung Galaxy Tab, saying the tablet, with a 7-inch screen, would be on sale at Sprint in a few weeks. He didn't activate the Galaxy, but showed how a user could easily carry the device, sliding it into his front pants pocket.

Hesse's comments on the potential surplus increase for 4G smartphone users came at the end of his comments on Sprint's attitude about net neutrality. While he indicated at one point that he doesn't expect Sprint to impose metered pricing on Sprint's 4G services, he said earlier that "we will watch it closely," noting that the rest of industry is headed in that direction.

If AT&T, which uses metered pricing, and Verizon Wireless, which has plans for metered pricing with its upcoming LTE service, lead to customers switching to Sprint for unlimited services, Sprint might have to adjust its approach, Hesse said.

"If heavy users flock to us, we'll watch that," he said.

"We can offer unlimited [usage] as long as the usage is reasonable," Hesse said. "If you run an all-you-can-eat buffet, but you have the New England Patriots come in and the whole team spends a whole day there, I can't afford to do that anymore."

Still, Hesse said having unlimited data plans seems what customers want, he said, noting that he has a year-long car wash pass. "I spend more probably than I would without it, but I enjoy not having to pay to wash my car each time."

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen or subscribe to Matt's RSS feed. His e-mail address is mhamblen@computerworld.com.

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